How to create a data-driven customer experience in the age of the influencer

In today’s digital world, it’s easier to share our experiences with others online than ever before. This ease of sharing has provided the opportunity for companies to gather real-time feedback and insights, fostering a data-driven customer experience approach that can drive innovation and enhance customer satisfaction.

According to Zendesk Research, 59% of people will refer family and friends to companies they’ve have had positive experiences with. Consequently, 53% of customers will not only leave if their experience is poor, but they will also be more likely to share a negative experience rather than a positive one – displaying that negative reviews can have a detrimental impact on your business.

Beyond leaving reviews, how can companies know when they’re succeeding in meeting the customers’ basic needs or if there is a missed opportunity for growth resulting from continuous delivery of poor experiences? Essential data points such as key performance indicators (KPIs) can provide insights into how customers are engaging with your company – indicating whether they are satisfied, likely to stay or potentially considering alternatives. And while these metrics offer tangible results, understanding the “why” behind customer sentiments is crucial for improving overall customer experience, requiring deeper analysis beyond surface-level data to address deficiencies and capitalize on successful strategies.

What influences you?

To gain a stronger understanding of your company’s customer experience, it’s important to begin by considering certain factors that influence our perspectives.

We are living in the experience economy – a place where perception and the value of the psychological impact we receive from a purchasing decision can carry as much or more weight than the tangible benefits of a product or service itself. Therefore, it’s important to understand some of the factors that influence your individual customer’s perspective on the experience (or perceived experience) they receive. Customers perceptions are shaped by myriad factors such as:

• Economic: The money available to either spend or save
• Cultural: Values, preferences, perceptions and buying behaviors
• Psychological: Motivation, customer perception, learning process and attitude
• Social: Motivation by societal or social impacts

Companies looking to influence customers should focus on providing tailored, positive experiences to create differentiation and preference for their company. While technology will continue to change the way you compete for engagement, customer satisfaction resulting from a delivered experience is one of the few remaining innovation areas that can help your company gain preference even beyond the price. Therefore, it’s important to consider both that the experience you provide is existentially tied to your ability to compete in the market and that there are external factors outside of your control that will influence your customers’ perceptions.

Utilizing data

As you seek to understand the experience you are delivering from your customers’ perspectives, your existing data can indicate how well you are doing in meeting those expectations. Some of the most important KPIs you can look at to provide a general indication are:

• Net revenue and retention
• Repeat buyers (net new purchases or renewals)
• Churn rates
• Customer lifetime value (CLTV)
• Customer service request increases or escalations
• Unsolicited feedback (good and bad)

Measuring the right KPIs by assessing new buyers, repeat buyers and the lifetime value of a customer is essential to gauge customer satisfaction. By looking at how much it costs to gain a new customer, how much it costs to keep them and how much revenue is generated, you can make a general determination of how positively or negatively customers are experiencing your product or service.

What is a Net Promoter Score?

Net Promoter Score (NPS) is a metric used to gauge customer loyalty and satisfaction by measuring the likelihood of customers to recommend your company’s products or services to others on a scale from 0 to 10. By surveying your customers with this scale, you can identify unsatisfied and at-risk customers, and generally correlate revenue to customer satisfaction.

While the NPS score can provide an overall understanding of customer satisfaction, it doesn’t highlight where improvements in products or services are needed or offer specific guidance for ways to improve the experience. To understand what you need to do to improve the experience and create better value, you need to explore more deeply than simply knowing if you have delivered a good or bad experience. In seeking this understanding it’s essential to ask additional questions relevant to a single point in the customer journey as opposed to asking for feedback once a year which might give insight on the latest interaction but not the cumulative experience.

The customer experience journey

Feedback, whether it is good or bad, is important to consider when thinking about customer experience holistically. Customer complaints should not be considered annoyances to be dodged or buried but instead are valuable pieces of feedback that can help you realize when you aren’t fundamentally meeting your customers’ needs.

Every interaction or touch point with the customer is an opportunity to solidify your brand value and reputation. Data points on their own don’t provide the full context we need to understand what’s really going on, so you need to do the work of reaching out to ask our customers how they’re doing through customer listening activities in the moments that matter.

Lastly, your brand image is essentially carved out by the customer experience you deliver, and no amount of throwing money at a situation is going to bury a bad image or reputation. You need to invest in your customer experience as it is your competitive advantage and brand differentiator and recognize the power it has to impact top line revenue growth and profitability.

How to get started

Customer experience is at the forefront of what makes a business successful. Utilizing your customer data can show you what areas to focus your efforts on and where to invest in to drive more positive outcomes for not only your business but also for your customers.

Baker Tilly’s digital team can work with you to embrace a data-driven strategy to help increase your customer experience while continuing to achieve your goals. Interested in learning more? Contact one of our professionals today.

This article was derived from the How to create a data-driven customer experience in the age of the influencer webinar, watch the full recording below.